PCB | November 15, 2007

Financial effects ot Aspocomp<br>and Meadville partnership

Aspocomp Group Oyj has on 8 November 2007 given a stock exchange release according to which it will contribute its shareholdings in its subsidiaries in China and India as well as certain equipment from its Salo plant to a new holding company and sell 80 percent of the shares of the holding company to Meadville Holdings Limited or its subsidiary.
In addition, Aspocomp Group Oyj and Meadville Holdings Limited have agreed that Aspocomp Group Oyj will sell 10 percent of the shares of Aspocomp Oulu Oy to Meadville Holdings Limited. The consideration for the shares is approximately EUR 1.8 million.

Meadville Holdings Limited will pay about EUR 61 million to Aspocomp Group Oyj for its 80 percent holding in the holding company. Aspocomp Group Oyj will use about EUR 40 million of this consideration to repay its loan to Standard Chartered Bank in full and about EUR 8 million to repay the working capital facilities of its Chinese subsidiary. The balance of the consideration will be used to partially repay the Aspocomp Group's interest bearing liabilities in Finland and to improve its liquidity.

Following the transaction, Aspocomp Group Oyj's assets would comprise a holding of 20 percent in the new holding company, a holding of 90 percent in Aspocomp Group Oyj's subsidiary Aspocomp Oulu Oy, a holding of about 87 percent in Aspocomp Group Oyj's Thai subsidiary, a holding of about 15 percent in Imbera Inc and real estates in Salo and Oulu.

After the transaction and the repayment of the loans as specified above, the major liabilities of the Aspocomp Group would amount to about EUR 57 million and the equity ratio of the Group would be expected to be approximately 12 percent. The aggregate amount of debts of the Group would still exceed the book value of its assets. It is estimated that after the transaction and the repayment or partial repayment of the above referred loans, Aspocomp Group Oyj's turnover in 2008 would be approximately EUR 40 million and the EBITDA would be positive. The financial position of the Group and the liquidity of Aspocomp Group Oyj would remain weak.

Aspocomp is negotiating with Finnish banks about debt restructuring agreement to reorganize its liabilities.

As the majority shareholder of the joint venture, Meadville Holdings Limited would be the main responsible for running its business operations. The intention is to develop and rationalize the joint venture's operations and subsidiaries.

Aspocomp Group Oyj has been informed that Meadville Holdings Limited will issue a stock exchange release in the near future as regards the transaction pursuant to the rules of the Stock Exchange of Hong Kong Limited. After Meadville has issued the referred stock exchange release, Aspocomp will issue the same release.

The agreement with Meadville Holdings Limited is subject to, among other things, the approval of the Extraordinary General Meeting of Aspocomp Group Oyj and to the approval of the shareholders of Meadville Holdings Limited.


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